Riaz Haq writes this data-driven blog to provide information, express his opinions and make comments on many topics. Subjects include personal activities, education, South Asia, South Asian community, regional and international affairs and US politics to financial markets. For investors interested in South Asia, Riaz has another blog called South Asia Investor at http://www.southasiainvestor.com and a YouTube video channel https://www.youtube.com/channel/UCkrIDyFbC9N9evXYb9cA_gQ

Saturday, April 2, 2016

India Files H1B Visa Complaint Against US to WTO Amid Falling Exports

India has recently complained to the World Trade Organization against the United States over changes to visas for skilled workers that Republican presidential candidates have targeted for elimination, according to a report in the UK's Financial Times.

The WTO revealed that India had requested consultations with the US over moves by Washington to raise fees for L1 and H1B working visas and also restrictions on the number of those visas awarded. The move is the first step in initiating a dispute at the WTO.

India's WTO complaint:

India's WTO complaint is over an increase in fees on H1B visas that the US imposed on companies with workforces comprised of more than 50 percent foreign workers. A provision included in last year's federal spending bill added a new $4,000 fee for each H1B, which India argues is discriminatory to the country under its trade agreement with the US.

Meanwhile, the annual gold rush in Silicon Valley to file applications for H1B visas has just begun, as the federal government began distributing some of the 85,000 H1B visas it is authorized to issue this fiscal year, according to Vice News.

1. India's overall exports have suffered 18th consecutive monthly decline in February 2016, according to India's Economic Times. Exports from India amounted to US$264 billion in 2015, down -12.4% since 2011 and down -16.9% from 2014 to 2015.

2. Most of India's IT exports to the United States are made up of wages of H1B workers brought to the United States by a handful of Indian body shops like Tata Consulting Services (TCS) and Infosys. In 2014, 86% of the H1B visas for tech workers were granted to Indians, according to available data. Given India's heavy reliance on H1B workers for its IT exports earnings, it is natural that the Indian government gets very concerned whenever there's even a hint of the US possibly limiting H1B visas or making them more expensive.

Excluding the Indian H1B workers' pay, such exports drop to about one-twentieth of the the amount reported by the Indian government as IT exports, according to a 2005 study by US General Accounting Office (GAO).

The Indian body shops like Cognizant, TCS and Infosys that rely on the H1B visa program in the US are "the shining star" of the Indian economy, and the country's largest export, according to an Indian-American professor Ron Hira who is a strong critic of the abuses of H1B program. By complaining, the Indian government and firms that rely on the program are trying to "build up a firewall so that no other reforms can come through and constrain the program in any way."

Indian Code Coolies:

H1B workers brought in by Indian body shops are described variously as "code coolies" or "H1B slaves". Some call them "indentured servants", like the ones from India who replaced slave labor after the British empire abolished slavery.

“’Indentured servants’ is a pretty accurate term because in many cases that’s exactly what’s going on,” said Phillip Griego of San Jose’s Phillip J. Griego and Associates. Over the years, Griego and his law partner, Robert Nuddleman have represented several H-1B workers in lawsuits against body shops.

Summary:

India has complained to the World Trade Organization about changes to the US H1B that mainly benefit India's body shops like Cognizant, Infosys and Tata at the expense of both US and Indian workers. US workers lose their jobs while Indian workers are exploited as wage slaves. India uses the wages of Indian H1B workers to inflate its IT export earning by as much as 20X. Proposed changes to H1B visa program like higher fees and lower numbers threaten India's export earning which have declined for 18 months in a row. The ongoing election debate over whether the H1B program is hurting American workers rose to public consciousness amid the Republican primary debates this year. The election outcome has the potential to negatively impact Indian H1B exports earnings.

Many H-1Bs are issued to offshore outsourcing companies, especially from India, which have U.S. subsidiaries that bring in foreign labor they subcontract to American banks, retailers and others. Critics say those foreigners displace U.S. workers because they are often paid lower wages.

As the presidential race has thrust immigration and job displacement center stage, demand for foreign skilled-worker visas coveted by tech companies is expected to far outstrip supply again this year, likely prompting the government to hold a lottery.

“April 1 isn’t so much as a start date, but a starting gun for the furious race by U.S. employers to secure skilled labor,” said Adams Nager, economic policy analyst at the Information Technology and Innovation Foundation, a tech policy think tank.

U.S. companies can sponsor 65,000 foreigners with at least a bachelor’s degree from any university. An additional 20,000 visas go to individuals with advanced degrees from U.S. institutions. Universities and nonprofits, which aren’t subject to a cap, also use H-1Bs to hire many workers each year.

The 85,000-quota is expected to be exhausted in a matter of days for the third consecutive year despite announcements by some tech companies of layoffs, according to federal officials and immigration attorneys who file petitions for companies.

Employers pay fees to the government and lawyers to apply for the visas.

“I marvel at the fact that employers are willing to pay thousands of dollars just to get a chance to be subjected to a random lottery,” said Los Angeles-based Rita Sostrin, among many attorneys who said their H-1B business has grown significantly this year.

Ms. Sostrin predicted that individuals competing for a visa in the regular “skilled” category, for people with a bachelor’s degree, will have less than a 20% chance of being selected in a lottery. Those with advanced degrees will have less than a 50% chance, she said.

“The tech industry is not slowing down here that I have seen,” said Gregory McCall, an immigration attorney in Seattle. Based on his caseload, “there are plenty of companies going like gangbusters.”

Arguing that it faces a shortage of specialized workers, the U.S. tech industry has for years lobbied to expand the H-1B program—and counted on support from the business-friendly Republican establishment. The 2016 presidential race has altered the picture.

On the campaign trail, the program has been blamed by some candidates for enabling employers to hire cheaper foreign labor at the expense of U.S. workers.

At rallies, GOP front-runner Donald Trump has featured tech workers who said they were replaced by foreigners. At a recent debate, Mr. Trump briefly disavowed his opposition to the visa program, saying such foreign workers were needed. But a short time later he switched back to opposing the program.

Republican rival Ted Cruz, who supported the program’s expansion in 2013, has called for a moratorium until it is reviewed. Democratic contender Bernie Sanders also is a critic; Hillary Clinton is a supporter.

“This is the first time the H-1B program has entered a presidential campaign. As a result, it’s received more scrutiny than it has in the past,” said Ron Hira, a Howard University professor who studies the program.

Mr. Hira, a critic of the program, said the Obama administration has failed to protect U.S. workers’ interests. “The not so subtle message to American workers is ‘tough luck’—you should be replaced by a cheaper H-1B guest worker.”

Many H-1Bs are issued to offshore outsourcing companies, especially from India, which have U.S. subsidiaries that bring in foreign labor they subcontract to American banks, retailers and others. Critics say those foreigners displace U.S. workers because they are often paid lower wages.

India's manufacturing value added (MVA) per capita of 161.7 in 2013 is among the lowest in the world. It's up from 131.9 in 2008.

In fact India's 2008 MVA per capita of 131.9 was lower than Pakistan's 141.1. Since 2008, Pakistan's MVA per capita has slipped to 139.1 in 2013 while India's has increased to 161.7 in this period.

Bangladesh's MVA per capita has jumped from 82.2 in 2008 to 118.3 in 2013.

On UNIDO’s industrial competitiveness index, most industrialized countries lost ground in the last three years. Among the five most competitive are four high-income countries (Germany, Japan, the Republic of Korea and the United States), along with China ranking fifth. The four are among the world’s most industrialized countries and, with China, account for 59 percent of world MVA.

What makes you think it's not? Hillary Clinton supports the expansion of H1B program as do many in US Congress who get fat donations from the high-tech lobby...the same groups that helped it grow last year when Google's Eric Schmitt said:

The executive chairman at Google urged Congress on Wednesday to increase the number of high-skilled work visas made available to foreigners and to deal with other immigration issues later on.

Eric Schmidt spoke Wednesday at the American Enterprise Institute, a conservative think tank. Schmidt said he believes the United States is better off having more immigrants, not fewer, but he particularly is focused on allowing more immigrants into the U.S. with specialized technical skills.

Hopefully, the LNG deal with Qatar and lifting of Iran sanctions will help alleviate this crisis.

Unlikely LNG is normally 2 times more costly than piped gas in the international market.Why do you think the EU has not been able to break Russia's stranglehold?

Also Iran is India's strategic partner.It has the world's largest gas reserves but because it can't build pipelines to Europe(Because of Turkey's informal understanding with GCC) and can't compete Geographically with Russia for supplying gas to China(Siberia being contiguous and practically next door) it basically has only India as a large enough market (200 Bcm/year requirement by 2020) where it can build undersea pipelines.

India’s attempt to diversify and deepen its corporate debt market has fallen flat, thanks to lack of demand and bad timing.

Last fall, Prime Minister Narendra Modi indicated to a gathering of 60,000 people at London’s Wembley Stadium that after James Bond, and Brooke Bond tea, a new type of bond was coming to markets: bond, rupee bond.

Looking for ways to help Indian companies take on more debt, invest and create jobs, the government last year allowed them to issue rupee-denominated bonds overseas.

Asia’s third-largest economy is looking to mimic China’s success with its yuan-denominated, “dim-sum” bonds which have raised more than $100 billion for Chinese and other companies since they were launched in 2007, according to data from Dealogic.

However, despite Mr. Modi’s high-profile quips, plans to issue more than $1.5 billion from so-called masala bonds have yet to raise a rupee.

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The holdups are hampering India’s efforts to spread the use of the rupee as an international currency, diversify its source of funds and reduce its dollar liabilities.

Unrestricted by Indian regulations, global financial institutions like International Finance Corp., Inter-American Development Bank and European Bank for Reconstruction and Development, have issued rupee bonds outside India for more than a decade. Around $3.8 billion worth of rupee bonds are outstanding offshore, versus $64 billion worth of yuan-denominated bonds, according to Dealogic.

Masala bonds are an attractive source of funds for Indian companies as investors bear the foreign-exchange risk. Many Indian companies are struggling as the amount of rupees they have to pay to service their dollar and euro debt has ballooned as the South Asian currency has depreciated over the past year.

The masala-bond market was opened to companies late last year just as global interest in emerging markets was on the decline. The rupee has been volatile since then, adding to investors’ concerns about the downside of an investment in the currency.

Indian companies are also reluctant to pay the higher yield that investors want to compensate for the risk.

“Liquidity is going to be quite bad offshore; I would obviously require some premium with regard to yields,” said Ms. Leong of Aberdeen.

“The pricing we are getting [in masala bonds] would be a little higher than the cost at which we could raise money in the domestic market,” said Keki Mistry, chief executive officer at HDFC.

Russia needs Western Europe more than Western Europe needs Russia as far as energy is concerned.

Don't read the US press look at the deliveries. Has there been a substantial increase of LNG supply to Europe?Has there been any new LNG terminals brought online outside Spain(Which is not well connected to the rest of the EU gas grid).

Why do you think the EU is dragging its feet on more sanctions on Russia?

Anyway I suggest Pakistan gets its act together in the next 5 years or else its all over.

I am not hopeful but miracles have happened in other places.Lets see what happens.

Anon: "Don't read the US press look at the deliveries. Has there been a substantial increase of LNG supply to Europe?Has there been any new LNG terminals brought online outside Spain(Which is not well connected to the rest of the EU gas grid)."

What do you think Russia is going to do with its gas? Ship it elsewhere?

Russia is heavily dependent on gas revenues. Its economy is shrinking. It's in deep trouble.

Samant: "Yeah slaves, those slaves are going around US and are having a good time :) slaves are also buying thier own houses there. Lolz"

Own houses? Indentured servants don't own houses

Consulting firms recruit and then subcontract out skilled foreigners to major tech firms throughout the country and many in Silicon Valley.

Those who work for these third party firms that skirt the law often call them “body shops” and sometimes they get caught.

For example in August, 2014, a Cupertino man involved with one body shop pleaded guilty and was sentenced in US District Court to 19 felony counts of visa fraud where he admitted he knowingly applied for work visas for foreigners who had no job offers, filling out applications for fake jobs for a Silicon Valley tech firm.

However, some local workers say many don’t get caught. And the workers are the ones who suffer.

“It virtually makes these employees a slave,” said one worker who came from India more than a decade ago.

“The body shops have a specific business model,” the worker said. “They make business and profit by having cheap labor.”

Because the man fears for his safety and his future, he asked that he remain anonymous. He had worked for 7 to 8 different body shops before he spoke to us.

“There are times when I am trapped there are times when I am, yes, I feel I am trapped,” he said.

Samir: "The data above is from WORLD BANK showing exports of GOODS & SERVICES. "

India's IT services exports are highly inflated and misleading.

A 2005 study by US General Accounting Office (GAO) found that Indian government's figures for software and technology exports to the United States were 20 times higher than the US figures for import of the same from India.

U.S. General Accounting Office looked at the 2003 data showing the United States reported $420 million in unaffiliated imports of BPT (business, professional, and technical) services from India, while India reported approximately $8.7 billion in exports of affiliated and unaffiliated BPT services to the United States.

In theory, India follows what is known as BPM 6 (MSITS) reporting method for software and information-enabled technology services (ITES) which counts sales to all multinationals, earning of overseas offices, salaries of non-immigrant overseas workers as India's exports. In practice, India violates it. BPM 6 allows the salaries of first year of migrant workers to be included in a country's service exports. India continuously and cumulatively adds all the earnings of its migrants to US in its software exports. If 50,000 Indians migrate on H1B visas each year, and they each earn $50,000 a year, that's a $2.5 billion addition to their exports each year. Cumulatively over 10 years, this would be $25 billion in exports year after year and growing.

'In theory, India follows what is known as BPM 6 (MSITS) reporting method for software and information-enabled technology services (ITES) which counts sales to all multinationals, earning of overseas offices, salaries of non-immigrant overseas workers as India's exports. In practice, India violates it."

That still is puzzling. First from an accounting perspective a WIPRO or a TCS has to pay corporate tax on that income. Secondly, how does India manage to grow it's ForeX reserves year after year - now at $360 billion

Samir: " how does India manage to grow it's ForeX reserves year after year - now at $360 billion"

Let's talk about the US part of it.

The Indian H1B visa holders make up over 80% of the visa issued each year.

These workers renew their visas each year and live and work in US for many many years after arriving in this country.

US Center for immigration studies estimated there were 650,000 H1B workers in the US in 2009, a number that is sure to have exceeded a million H1B visa holders in America by now.

The BPM 6 (MSITS) reporting method allows for inclusion of their pay only in the first year as H1B worker in this country, not for subsequent years. India violates this rule and continues to add up their salaries into its export earnings for many many years after they arrive.

So, lets say there are conservatively 600,000 Indian H1B workers in the US each being paid conservatively $80,000 a year. This adds up to $48 billion from US alone. This amount should be counted as part of remittances from overseas workers, not as IT exports for the year.

sundar: "Why is India complaining this with WTO? US H1 B visa fees are local US laws."

Read my post carefully.

Any efforts to make H1B visa difficult or expensive has a direct impact on Indian body shops like Infosys and Tata. It could cut directly into the cumulative H1B worker wages that India counts as its IT exports.

WTO is the front channel, which is not of any use. The lobbyist will take care of this, once Hillary is in power.These sarcastic coolie remark are partly true, but only for a short time. All work crazy hard, many soon employ Americans with their own startups. No wonder Indians are looked up to here.(with very little racial bias).Pakistanis get a free pass for looking same.

The current debate against H1B is aimed mainly at Indians, particularly the Indian body shops like InfoSys and Tata, who are the biggest abusers of the program. There are several lawsuits pending in courts to address it along with the growing political opposition to it in US Congress.

Well you call them "Indian Coolies" but do you know the situation of many Pakistanis in GCC. According to the International Organisation of Labour, Pakistan is the second among South Asian nations sending migrant workers abroad. Nearly 7 million Pakistanis have left the country in recent years for the purpose of finding a job and 96 per cent of them make their way to the GCC countries, closely followed by Saudi Arabia.Once in Saudi Arabia or Dubai or Abu Dhabi, theirs is a grim reality. The kifalah system of sponsorship that gets them there insures that they are already deeply in debt before they ever start working.

As has been reported in a recent front page story in the New York Times, the Pakistani workers usually do menial jobs in construction, garbage disposal, cleaning, ground crews and such. They live in labour camps in deplorable conditions, sometimes 10 or 15 in a single room, with any clothes they may wear and any food they may eat crammed in between the bunks.

Often, employers refuse to pay them, or pay them months after they are due. The recruiters to whom they owe money take anything they get, before any money can be sent home. If they complain too much, there is always the prospect of arrest. They receive no legal advice, no lawyers and no leniency. Punishments are the only certainty.

There are a lot more Indians suffering worse treatment than Pakistanis in GCC nations.

What is Indian govt doing about that?

What can it? It depends on them for vast amounts of foreign exchange. The country sending the largest remittances to India is UAE ($13.2billion) followed by US and Saudi Arabia ($11 billion each) and Pakistan ($4.9 billion).

#India's population explosion will make or break its economy. Not enough jobs and huge skills gap #BJP http://cnnmon.ie/1V1p0FL via @CNNMoney

unless India makes big improvements in how it educates and trains students, this demographic boom could instead saddle the country with another generation of unskilled workers destined to languish in low-paying jobs.The need to train workers up -- and quickly -- is paramount. Currently only 2% of India's workers have received formal skills training, according to Ernst & Young. That compares with 68% in the U.K., 75% in Germany and 96% in South Korea.It's a problem spread across industries. The Royal Institution of Chartered Surveyors estimates that in 2010, India needed nearly 4 million civil engineers, but only 509,000 professionals had the right skills for the jobs. By 2020, India will have only 778,000 civil engineers for 4.6 million slots.There is a similar gap among architects. India will have only 17% of the 427,000 professionals it needs in 2020.

The problem? The RICS found that India's education and professional development system has not kept pace with economic growth and is in "dire need for reform."In industry after industry, the same story is repeated. A recent survey by Aspiring Minds, which tracks workforce preparedness, found that more than 80% of India's engineering graduates in 2015 were "unemployable.""The quality of training offered in most colleges is not at par with the high demands generated by tech industries," said Preet Rustagi, a labor economist at the Institute for Human Development. "There is no regulatory body that keep checks on the quality of education."

Critics say India's universities are too focused on rote memorization, leaving students without the critical thinking skills required to solve problems. Teachers are paid low salaries, leading to poor quality of instruction. When students are denied entry to prestigious state schools, they often turn to less rigorous private colleges."When IT industries boomed in India a few years ago, many below-the-mark private colleges emerged to cater to their needs," said Alakh N. Sharma, director at the Institute for Human Development.

Prime Minister Narendra Modi is racing to provide workers with training. His government is recruiting skills instructors, and turning old schools into learning centers. Programs strewn across various government agencies are being consolidated. Companies in the private sector are pitching in to help provide training.The most pressing need, however, might be in primary education. Pupils in India are expected to perform two-digit subtraction by the age of seven, but only 50% are able to correctly count up to 100. Only 30% of the same students are able to read a text designed for five-year-olds, according to education foundation Pathram.If the country's unique demographics are to pay dividends, improvement is a lesson to be learned quickly.

"#India's population explosion will make or break its economy."As far as I know, India's population growth rate is lesser than Pakistan. Moreover, through United Nations Fertility Variant, it will start declining after 2060.

For skill development, I know that manpower is emerging faster than jobs. And that's why Govt. has launched standup India program a few days ago to create industrialists.

Case of catching up with quality, Indian Institutions are catching up and will achieve with time (I'm myself connected to this sector). Can you tell where does Pakistan stand here. Your country's literacy must be greater concern for you.

MoA: "Case of catching up with quality, Indian Institutions are catching up and will achieve with time (I'm myself connected to this sector).Can you tell where does Pakistan stand here. Your country's literacy must be greater concern for you. "

First, let me respond to your concern for Pakistan. Yes, the literacy rate is a concern of mine too. It needs to rise faster than it is.

But your assertion about India "catching up with quality" does not appear to be supported by evidence.

Since you like to compare India with more developed countries, here's what you need to pay attention to:

Currently only 2% of India's workers have received formal skills training, according to Ernst & Young. That compares with 68% in the U.K., 75% in Germany and 96% in South Korea.

http://cnnmon.ie/1V1p0FL via @CNNMoney

Indian kids rank near the bottom on international standardized assessment tests like PISA and TIMSS.

http://www.riazhaq.com/2011/12/pisa-timss-confirm-low-quality-of.html

Pakistani kids are doing better than Indian kids on both math and verbal tests, according to a World Bank report.

Pakistan's grade 5 and 8 students outperform their counterparts in India, according to the World Bank report titled "Student Learning in South Asia: Challenges, Opportunities, and Policy Priorities"While 72% of Pakistan's 8th graders can do simple division, the comparable figure for Indian 8th graders is just 57%. Among 5th graders, 63% of Pakistanis and 73% of Indians CAN NOT divide a 3 digit number by a single digit number, according to the report.. The performance edge of Pakistani kids over their Indian counterparts is particularly noticeable in rural areas. The report also shows that Pakistani children do better than Indian children in reading ability.

Today will be a case in point: after the couple land in Mumbai they will go straight to their first engagement, laying a wreath to the victims of the 2008 terrorist attack on the Taj Palace Hotel, then move on to a slum to see the work of three children’s charities, before rounding off the day with a charity gala dinner to raise money for the same charities, where celebrity guests will include the “Queen of Bollywood”, Aishwarya Rai Bachchan, and cricketing legend Sachin Tendulkar.Their slum visit this morning will transport them to a world which could barely be more different from the Duke and Duchess’s palatial home life.

Anmer Hall, the Duke and Duchess’s home in Norfolk, could comfortably be divided into more than 100 typical dwellings in the Baba Sheb Ambedkar Nagar slum, where Saniya lives, meaning the Grade II* listed property would be home to upwards of 500 people, rather than four. They also have a London home at Kensington Palace.

A crude comparison, perhaps, but one which has clearly crossed the minds of Saniya and other pupils at the slum’s Door Step school. Many of them start work at the age of seven gutting fish or scavenging rubbish dumps for £3 a day and drop in to the school in the evenings to learn how to read and write.

The school’s founder, Bina Sheth Lashkari, said: “We have shown the children pictures of the Duke and Duchess and where they live. The children know they are going to meet a Prince and Princess and they have asked if they are like the Princes and Princesses in fairy tales. One of the girls asked if the Princess had big hair, like Rapunzel.

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In 33C heat they will have to pick their way through the stray cats and dogs foraging scraps of food, avoid the opaque brown puddles in the beaten earth paths and the jumble of electrical wires at head height, before being shown into one of the shockingly tiny homes, smaller than a walk-in wardrobe.

At Western Kentucky, 106 of 132 students admitted through the recruitment effort (in India) scored below the university’s requirement on an English skills test, according to a resolution adopted last fall by the graduate faculty council, which raised questions about the program. “The vast majority either didn’t have any scores or there wasn’t documentation of their language skills,” said Barbara Burch, a faculty member of the university’s Board of Regents.

“Hurry Up!!!” the online posting said. “Spot Admissions” to Western Kentucky University. Scholarships of up to $17,000 were available, it added. “Letter in one day.” The offer, by a college recruiter based in India, was part of a campaign so enticing that more than 300 students swiftly applied to a college that many had probably never heard of.

More than 8,000 miles away, at Western Kentucky, professors were taken by surprise when they learned last fall of the aggressive recruitment effort, sponsored by their international enrollment office. Word began to spread here on campus that a potential flood of graduate students would arrive in the spring 2016 semester.

The problem — or one of them — was that many of the students did not meet the university’s standards, faculty members said, and administrators acknowledged.

Western Kentucky’s deal with the recruiting company, Global Tree Overseas Education Consultants, is a type of arrangement that is becoming more common as a thriving international educational consultancy industry casts a wide net in India and other countries, luring international students to United States colleges struggling to fill seats. The university agreed to pay Global Tree a commission of 15 percent of the first year’s tuition of students who enrolled, or about $2,000 per student.

But as colleges increasingly rely on these international recruiters, educators worry that students may be victimized by high-pressure sales tactics, and that universities are trading away academic standards by recruiting less qualified students who pay higher tuition.

Earlier, Singh demanded that the voting rights of couples with more than two children be revoked, to develop the nation.

"If Malaysia and Indonesia can make such a law, why can't we?" the minister asked, adding, "The nation won't progress without population control."

"There must be a balance. Hindus, Muslims, Sikhs and Christians -- all must have at least one to two children. Those who don't follow, their voting rights must be revoked," Singh declared.

"A law is needed on population control for all religions if development is required," he added.

On Wednesday, Singh said if India did not change its population policy and enforce a two-child norm for all religions, then the nation's daughters would not be safe and may have to wear a veil as they do in Pakistan.

Speaking at a cultural yatra in West Champaran's Bagaha town, Singh was apparently referring to Bihar districts Araria and Kishanganj, where the Muslim population has increased faster than the Hindu population.

Never the one to shy away from putting things bluntly, Republican presidential frontrunner Donald Trump has expressed his displeasure at India's outsourcing industry by impersonating a call centre representative in India.

However, just moments later, he goes on to call India a great place, asserting that he is not angry with Indian leaders.

At a campaign rally in Delaware, the billionaire from New York said that he called up his credit card company to find out whether their customer support is based in the US or overseas."Guess what, you're talking to a person from India. How the hell does that work?" he told his supporters.

"So I called up, under the guise I'm checking on my card, I said, 'Where are you from?'" Mr Trump said and then he copied the response from the call centre.

"We are from India," Mr Trump impersonated the response.

"Oh great, that's wonderful," he said as he pretended to hang up the phone.

"India is great place. I am not upset with other leaders. I am upset with our leaders for being so stupid," he said.

"I am not angry with China. I am not angry at Japan. I am not angry with Vietnam, India...all these countries."

Mr Trump mentioned the fake call to India during his remarks on what he described as "crooked banking".

Delaware, is a hub for the America's banking and credit-card industry. Topping the list include Bank of America, Citibank Delaware, M&T Bank and PNC Financial Services Group.

"They are making a lot of money," he said.

"You can't allow policies that allows China, Mexico, Japan, Vietnam, India. You can't allow policies that allows business to be ripped out of the United States like candy from a baby," Mr Trump said in his address.

"The manufacturing jobs are being stolen. Our jobs are being taken. We are losing at every front. There is nothing good. Our country does not win anymore. The jobs are being stripped. Factories are closing. We are not going to let this happen anymore," he said.

Mr Trump said he has as many as 378 companies registered in Delaware, where the Republican presidential primaries is scheduled on April 26 along with several other states.

He is leading in polls against his other primary rivals.

In his speech, Mr Trump praised Delaware's status as a tax shelter and slammed President Barack Obama for not using the term "radical Islamists" in the fight against terrorism.

"I want to run against crooked Hillary," he said, reiterating that a Trump vs Clinton race would bring the greatest turn out in the history of the American elections.

"We will stomp on Hillary Clinton no one's ever done."

He was also critical of Indian-American South Carolina Governor Nikki Haley, who did not endorse him during the primary.

Delaware has 16 delegates. Mr Trump has 845 delegates, followed by Ted Cruz (559) and John Kasich (148)

Patriotic chest-thumping over the weekend in India gave way to embarrassment and bitterness as the government made a very public U-turn on issuing a visa to Uighur dissident Dolkun Isa. He is the executive committee chairman of the World Uighur Congress, an organization that represents a predominantly Muslim ethnic group in China's far-west, and has been labeled a terrorist by the Chinese government. China issued a "red corner notice" to the international policing agency Interpol seeking his arrest more than a decade ago, but other governments have refused to act on the request.

Supporters of Prime Minister Narendra Modi's government, who are often self-conscious about how India matches up with China, took to social media over the weekend to celebrate the news that Isa had procured a tourist visa to India, using the hashtag #ModiSlapsChina. Many viewed the visa as a "slap" because China had used its clout at the United Nations earlier inApril to block India's attempt to have Masood Azhar, the alleged mastermind of an attack on an Indian air force base in January, designated an international terrorist.

Hua Chunying, a spokeswoman for the Chinese Foreign Ministry, was quoted in the Indian media as saying that "Dolkun is a terrorist on red notice of the Interpol and Chinese police. Bringing him to justice is due obligation of relevant countries.”

A spokesman for India's Ministry of External Affairs, Vikas Swarup, was noncommittal in his response, simply saying, “We have seen media reports and the ministry is trying to ascertain facts.”

On Monday, it became clear that India's various ministries had not coordinated closely enough, if at all, on Isa's visa, and its potential geopolitical ramifications, and they canceled the visa. Isa came forward with a statement expressing disappointment and said he could only speculate that Chinese pressure led to the reversal. The turnaround by the New Delhi government did not please Indians, with the hashtag #ModiBowsToChina topping India's Twitter trends Monday.

Is Reserve Bank of India Governor Raghuram Rajan on his way out? Earlier this month, a comment to a reporter by the head of India’s central bank drew fire from Prime Minister Narendra Modi’s party. Mr. Rajan played down talk of India as a bright spot in the global economy by citing an Indian proverb: “In the land of the blind, the one-eyed man is king.”

Commerce Minister Nirmala Sitharaman quickly declared that she “may not be happy” with Mr. Rajan’s choice of words. Junior Finance Minister Jayant Sinha echoed his colleague’s sentiments: “We are the shining star. I don’t agree with what the governor said.”

Senior Indian officials don’t usually admonish each other in public. That Mr. Rajan’s comment—an innocuous warning against premature hubris about high growth—drew ministerial backlash suggests trouble between the governor and the Modi administration. It could signal that Mr. Modi will refuse to extend Mr. Rajan’s tenure when his three-year term expires in September.

Picking a central-bank governor he likes is, of course, the prime minister’s prerogative. But letting Mr. Rajan go would be a mistake.

The governor, who was appointed by the previous Congress Party-led government, adds global credibility to India’s economic management. His candor and perceived sense of independence are strengths, not weaknesses. Mr. Modi and Finance Minister Arun Jaitley would be foolish to overlook this.

In India, where Reserve Bank governors are usually drab, the 53-year-old Mr. Rajan cuts a dashing figure. When he was appointed three years ago, the gossip columnist Shobhaa De called him “seriously hot.”

Indian media cover Mr. Rajan like a celebrity, chronicling his fondness for old Hindi movie songs, his penchant for running half-marathons, and his use of “dosanomics,” a reference to savory pancakes popular in southern India, to explain the dangers of high inflation.

Unlike most of his predecessors at the 81-year-old bank, Mr. Rajan earned his reputation overseas before returning to India. In 2003, the International Monetary Fund appointed Mr. Rajan, a professor at the University of Chicago at the time, as its youngest-ever chief economist, and the first from a non-Western country.

Two years later, Mr. Rajan warned of a financial bubble at the Federal Reserve Bank of Kansas City’s annual policy conference at Jackson Hole, Wyo. When the global financial crisis struck in 2008, many observers hailed Mr. Rajan for his prescience.

Four years ago, Mr. Rajan returned to India to serve briefly as chief economic advisor to then-Finance Minister P. Chidambaram before taking over at the Reserve Bank.

To some in the ruling Bharatiya Janata Party, Mr. Rajan is tainted by his appointment by the Congress Party. Nor did he help his own case by coming up with a sketchy index in 2013 that appeared designed to show that the western state of Gujarat, then headed by Mr. Modi, was not among India’s most developed.

Since Mr. Modi’s election two years ago, Mr. Rajan has been pressured to boost growth by cutting interest rates. Traditionally, India’s central-bank governors haven’t enjoyed as much independence as their American counterparts, but Mr. Rajan has guarded the bank’s mandate, established last year, of taming inflation.

He met the bank’s target by bringing Consumer Price Index inflation below 6% in January. At the same time, over the past 15 months, the Reserve Bank cut interest rates by 150 basis points to 6.5%, its lowest in five years.

Some also disparage Mr. Rajan’s tendency to speak about issues outside his area of responsibility, in ways that can appear critical of the government. In a speech last year, the governor warned against fetishizing strong governments by evoking Hitler.

During a national debate about rising intolerance, Mr. Rajan lectured students at the Indian Institute of Technology in Delhi about the country’s “tradition of debate and an open spirit of inquiry.”

#Pakistan #agriculture component of #GDP to be flat this fiscal year 2015-16 due to #drought, crop losses http://www.world-grain.com/news/news%20home/LexisNexisArticle.aspx?articleid=2577597560 …

Pakistans neglected agriculture sector is all set to face a major blow as the farm sector growth is expected to touch zero in the current fiscal year mainly because of negative growth in major crops including cotton, rice and sugarcane as well as dwindling commodity prices in international market, a senior economist said on Tuesday.

The agriculture growth might touch zero in the current fiscal year mainly because of negative growth of major crops like cotton, rice and sugarcane and poor performance of minor crops, said Dr Hafeez A Pasha, former finance minister, when contacted for his comments. The livestock might not be able to compensate overall farm growth up to the desired mark during the outgoing financial year.

Dr Pasha said whenever the countrys agriculture sector witnessed a dip; its overall gross domestic product (GDP) growth rate never crossed 4 percent in any year mainly because the countrys overall economy was largely dependent upon agriculture in terms of trade, commerce and agri-based exports.

Sources, however, said in the wake of expected flat growth of agriculture sector, which will remain in the range of just 0.3 to 0.5 percent, Pakistans prospects for achieving overall GDP growth rate have also plunged into danger zone as the growth rate will be hovering around 4.5 to 4.7 percent maximum for outgoing fiscal year against desired envisaged target of 5.5 percent in 2015-16.

When contacted a top official of the Pakistan Bureau of Statistics (PBS), he said the National Accounts Committee (NAC) was expected to meet by mid of next month. The PBS is not responsible to collect primary agriculture data as NACs agriculture committee will provide data to the PBS on the basis of which the farm sector growth will be estimated on provisional basis.

As the PBS did not see the data so far so it would be premature to give any judgment on this issue, the official said. But he added that the wheat crop might produce positive results mainly because of its output achieved in Barani areas of the country.

Many independent economists believe that the countrys agriculture sector might witness a negative growth in the current fiscal year but some economic managers claimed that the farm growth might slide into positive side by demonstrating nominal growth just around 0.5 percent. However it would be definitely missed out the fixed target of 3.9 percent for the current financial year.

For finalizing the Budget Strategy Paper (BSP) for next three years, Finance Ministry refused to bring down its envisaged GDP growth rate target of 5.5 percent for the current fiscal year despite insistence of Planning Commission to cut it to around 5 percent.

Ministry of Finance still appeared confident that the manufacturing and services sector could play major role to jack up overall GDP growth rate over 5 percent as they claimed that the sale of cement is increasing.

Overall, the agriculture sector grew by 2.9 percent in last fiscal year of 2014-15, which was lower than the envisaged target growth of 3.3 percent but higher than the growth of 2.7 per cent achieved during the fiscal year 2013-14.

India’s economy expanded by 7.3% last year, outpacing every other major nation, including China, for the first time in nearly two decades.

But as with most developing countries, where official statistics can be dicey even when they aren’t showing world-beating growth, India’s economy defies easy measurement. Most enterprises are tiny and unregistered, and most workers are employed off the books. The government’s infrequent surveys represent only a best guess of the value being added in back-alley workshops, outdoor markets and other cash-based corners of the economy.

So even if India’s measurement of gross domestic product, a broad indicator of activity, isn’t thought to be politically manipulated like China’s, it should come with a warning label: Handle with care.

GDP in India, “much more than in other economies, is more an estimate than a measurement,” said Neelkanth Mishra, a Credit Suisse economist in Mumbai.

The fog surrounding India’s GDP places challenges before analysts and policy makers—and just plain baffles some of them. The country’s central bank, sensing an economy running at less-than-full blast despite strong headline growth, has cut its main interest rate five times since the start of 2015.

One reason for the data murkiness can be found on Lal Bazar Street, a busy thoroughfare of tea merchants, typists-for-hire and a sitar shop in the heart of Kolkata, the country’s onetime colonial capital.

Within the dingy commercial buildings that line the roads in all directions are hundreds of addresses used to register shell companies, or ones used for tax-avoiding financial maneuvers and little else, tax authorities say.

Yet because these firms regularly file balance sheets to the government, they appear in a new official database of corporations—and get counted when statisticians tot up India Inc.’s contribution to national output.

India’s numbers have been under a microscope since it revised methods for estimating GDP last year, causing performance in earlier years to shoot up. Growth stayed brisk throughout 2015 even as exports, cargo traffic and other indicators disappointed.

A report from India’s Ministry of Finance said data-related uncertainty was causing economic signals to be “mixed, sometimes puzzling.”

The GDP revision included updates large and small. Based on an academic study of “dung evacuation rates,” goats and sheep were found to be contributing more to the economy, as producers of natural fertilizer, than previously thought. A much wider array of financial services is now being counted. But there are still areas where some observers, including the International Monetary Fund, see India’s data falling short.

To strip price changes out of a wide swath of GDP, for instance, India uses its wholesale price index—which, thanks to lower oil prices, has been decreasing for 17 straight months.

But many businesses, particularly services like finance and information technology, haven’t benefited much: Retail prices are still climbing at around 5% a year overall. If India’s statisticians were factoring in more of these price rises, then their inflation-adjusted GDP figures would be lower.

In a March report on India, the IMF criticized the use of wholesale prices in GDP. In a written response to questions, the country’s Central Statistical Office acknowledged the issue, but said that until India updates its inflation measures, the wholesale price index “remains the best available alternative.”

“There’s no rhyme or reason why the service sector would be deflated by WPI,” said Kunal Kumar Kundu, Société Générale SA’s India economist. “It’s basically a data availability issue. That will always continue to be a challenge.”

On the outskirts of the city, an ancient temple, surrounded by a buzzing market with food and flower stalls, rises on the banks of the Osman Sagar Lake. It is barely 8 a.m., but for hours already, the temple has been surrounded by a swirling mass of petitioners. Hundreds circle it quickly but silently, praying to the Hindu deity Balaji to grant the wish that has brought them here: to obtain a guest worker visa that will allow them to take their high-tech talents to America.

The Balaji Visa Temple is among a handful of such shrines that have sprung up in recent years, offering Indian workers hope of divine help in obtaining a temporary U.S. specialty-occupation visa, familiarly known as an H-1B. Those who receive them can spend three to six years working in the U.S. — a ticket, they believe, to a better, more financially secure future.

---

Those who are successful face other concerns: Navigating a system in which their employer controls their visa, and thus their legal status, leaving some feeling like indentured servants with no power over working hours or conditions. Having wages sometimes shaved through fees assessed by sponsoring companies, who may contract them out for other work.

And increasingly, being pointed to by critics of the H-1B program, including GOP presidential candidates Donald Trump and Texas Sen. Ted Cruz, as a threat to American workers.

Still, they come in waves to cities like Hyderabad and shrines like the Balaji temple, eager to vie for a once-in-a-lifetime experience. Some have seen their applications put forward year after year without success, putting off marriage or finding a permanent home in hopes that this will be the year they get to America. To jobs that will boost their careers and pay far more than they can earn here. To a few years of adventure in the land of Hollywood and Disney World.

Every year, thousands of Indian workers from Hyderabad alone get H-1Bs, while Indians overall make up more than two-thirds of those working on H-1B visas. Their growing presence has spurred calls for reform of the system on both sides: those who want the limited number of visas expanded and those who say the system has gotten out of control.

The number of visas available, however, has always been limited. Since 2004, the cap has been set at 85,000 new H-1Bs annually — 65,000 for foreign workers with at least a bachelor’s degree, another 20,000 reserved for those with advanced degrees from U.S. universities. Trade agreements reserve up to 6,800 of those visas for skilled Chilean and Singaporean workers.

Exempt from the cap are skilled workers employed in higher education, nonprofit research or government research. Also not counted in the cap are extensions of an H-1B for a second three-year term.

Since 2013, the huge demand for H-1Bs has prompted a computerized lottery to dole out the visas. That has spurred growing criticism of India’s multibillion-dollar outsourcing industry, which supplies legions of workers for U.S. companies every year. In fiscal year 2014, the most recent year data are available, 67 percent of H-1B visa recipients were from India, the highest proportion in at least 18 years.

Indian companies, including Tata Consulting Services, Wipro and Infosys, submit tens of thousands of visa requests on behalf of U.S. clients each year. Critics say they are effectively gaming the lottery — depriving smaller companies of the chance to fairly compete for H-1Bs and taking visas that could go to more highly skilled, higher-paid workers for low-level, lower-paid programmers.

----Another reason Washington and New Delhi have grown so close is the increasingly testy relationship between the United States and Pakistan, India’s longtime rival. Although Pakistan is formally an ally of the United States, American officials have made clear that India has displaced Pakistan in American interests and hearts.

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“We have much more to do with India today than has to do with Pakistan,” Defense Secretary Ashton B. Carter said in April. “There is important business with respect to Pakistan, but we have much more, a whole global agenda with India, agenda that covers all kinds of issues.”

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The two sides also announced that they intended to complete a deal in which India will buy six nuclear reactors from Westinghouse by June 2017, fulfilling an agreement struck in 2005 by President George W. Bush. The price is still under discussion, but more difficult issues like liability have been resolved.

“We continue to discuss a wide range of areas where we can cooperate more effectively in order to promote jobs, promote investment, promote trade and promote greater opportunities for our people, particularly young people, in both of our countries,” President Obama said in the Oval Office during the meeting.

---“The United States is well aware of the talent that India has,” Mr. Modi said in Hindi. “We and the United States can work together to bring forward this talent, and use it for the benefit of mankind and use it for the benefit of innovations and use it to achieve new progress.”

Mr. Modi has made clear that he intends to set aside decades of standoffishness — rooted in India’s colonial experience — to cement closer ties with Washington, in part because the next American leader may not share President Obama’s enthusiasm for India.

The news media in India has extensively chronicled comments by Mr. Trump that critics have said were racist, his “America First” views and his unorthodox campaign. While Mr. Trump, the presumptive Republican presidential nominee, has said little about India, his vows to tighten immigration policies worry Indian officials.

“Modi wants to get as much as he can out of Obama’s last months in office,” said Ashley J. Tellis, a senior associate at the Carnegie Endowment for International Peace.

--Mr. Trump has vowed to “cancel” the Paris climate agreement if elected, something Mr. Obama is eager to prevent. Once the accord enters into legal force, no nation can legally withdraw for four years.

“If the Paris agreement achieves ratification before Inauguration Day, it would be impossible for the Trump administration to renegotiate or even drop out during the first presidential term,” said Robert N. Stavins, the director of the environmental economics program at Harvard.

---The two sides also announced joint efforts for the United States to invest in India’s renewable energy development, including the creation of a $20 million finance initiative.

---

The two countries finalized a deal that allows their forces to help each other with crucial supplies, and the United States formally recognized India as a major defense partner, which should allow India to buy some of the most sophisticated equipment in the United States arsenal.

India’s increasing willingness to form military partnerships with the United States is, in part, a result of its deepening worries about China. Recent patrols by Chinese submarines in the Bay of Bengal have unnerved New Delhi, and a 2014 visit to India by the Chinese president, Xi Jinping, did nothing to soothe Indian sensibilities, as Chinese troops made an incursion into border territory that India claims as its own.

China’s refusal in the months since to resolve the territorial claims at the heart of the standoff has quietly infuriated Indian officials.

Companies such as Infosys, Wipro and Tata Consultancy Services (TCS) grew into global behemoths precisely because they sprung up in Bengaluru -- far from the watchful eye of Delhi-based bureaucrats. The tech industry fell into a regulatory blind-spot, unhampered by red tape and the labor laws that strangled other sectors. As one Indian minister noted over a decade ago, Indians do well “in IT and beauty contests, the two areas that the government has stayed out of." States like the one Bengaluru is in continue to exempt IT companies from especially suffocating regulations.

These firms offered businesses around the world an efficient, low-cost way to outsource their in-house IT work. Building and maintaining enterprise-specific IT infrastructure for overseas clients provided a steady stream of income. India could beat the competition for this work because of its large pool of trained, low-cost engineers.

Once wildly successful, this model has now begun to run into a whole host of problems.

First, slowing growth in the West means that many companies have cut down on the discretionary spending that once went into outsourcing contracts. Second, more restrictive visa laws in the West are making it tougher for Indian companies to get qualified engineers into their clients’ offices.

Third, that pool of Indian engineers isn’t inexhaustible. Salaries have begun to rise, threatening a business model based on generating relatively little revenue per employee. As far back as 2013, the Economist quoted one IT executive as saying that, for IBM, “the total cost of its employees in India used to be about 80% less than in America; now the gap is 30-40% and narrowing fast."

Fourth and most importantly, the technological landscape is shifting dramatically. Companies could once draw clear distinctions between the core of their business and extraneous IT work that could be outsourced. Now, with the shift to digital services and cloud computing, more and more companies view IT as integral to the transformation of their overall business. They're looking for higher-value services and more innovation than Indian IT companies have traditionally provided. Infosys's struggles with its core consulting revenue led to it declaring disappointing results last Friday.

Bengaluru's flagship companies are hardly unaware of this. Infosys has begun training its employees and board in “design thinking" -- a buzzword for prototype-driven innovation -- hoping this will help prepare them for a future in which they have to serve as all-around advisers for clients seeking to make their businesses fully digital. TCS says its revenue from such work is growing at 10 percent annually.

The problem is that these kind of projects don't require masses of low-priced engineers. TCS is hiring fewer people and laying off some.

A wave of job cutbacks could attract the baleful glare of the state. In a hangover from India's socialist past, the government has traditionally been overprotective of workers in the formal sector. While the roughly 3 million people who work in the IT industry are a tiny drop in India's billion-plus population, they account for a huge chunk of the organized labor market -- almost a quarter of the formal work force.

How will politicians and bureaucrats react to IT champions radically changing their operations, perhaps shrinking or even trying to move offshore? When some Indian airlines, as part of a necessary restructuring, tried to trim bloated bits of their work force a few years ago, the government pressured them into retreating. It's reasonable to fear that similar meddling might be in store for Indian IT.

After a sustained funding frenzy, investor enthusiasm for the country's tech startups has fallen sharply this year. Weaker firms are laying off employees and some have closed up shop altogether.Startup funding in the second quarter plummeted to $583 million from its recent peak of nearly $3 billion in late 2015, according to CB Insights. It's a sharp turnaround for a sector that attracted more than $8 billion last year."We've already felt the effects of what that bubble would be," said Arjun Malhotra, the co-founder of Indian startup incubator Investopad. "A lot of the companies that were high performing, they are crashing now."The slowdown has occurred despite favorable conditions: The broader Indian economy is booming, and inflation is low. Global investors are on the hunt for the next Facebook (FB, Tech30) or Amazon (AMZN, Tech30).With 1.3 billion citizens and a surplus of skilled IT workers, Indian startups proved irresistible to many investors. The success of homegrown e-commerce darlings Snapdeal and Flipkart, and ride-sharing app Ola, added credibility.Yet there is a simple explanation for the reversal: Investors say India's tech sector experienced a classic bubble, similar to the one that rocked Silicon Valley when it burst in 1999."I think India is going through its first bubble," said Kashyap Deorah, a former Silicon Valley entrepreneur who now runs a startup in Delhi. "It is a bubble and it is normal."

New Delhi: Software services firm Cognizant, along with most of its peers in the broader Indian IT industry, hasn’t had a particularly great business year.

The New Jersey-based firm — which has four out of every five of its employees deployed in India — has downgraded its revenue forecast two times since January, starting from “between 10% and 14%” to “at-best 13%” and finally “around 8.5-9.5%”.

The company’s 2016 revenue forecast is not only sharply down from its growth last year (when it clocked a cool 15%), but is also its slowest pace of growth since 1997; which is when Cognizant as we know it today officially came into existence.

Adding to this is a potential scandal in the making. Two weeks ago, in an early morning Nasdaq notification, Cognizant announced that it had commenced an internal probe into whether “certain payments relating to facilities in India were made improperly and in possible violation of the US Foreign Corrupt Practices Act”.

The market’s reaction was swift: Cognizant’s shares closed down a little over 13% on the day of the stock exchange notification, wiping out nearly $4.5 billion off the company’s market value. Shareholder reaction was equally swift and similarly punishing, with a class-action lawsuit being filed against the company last week.

Cognizant, however, isn’t alone. Rivals Infosys and TCS have their own controversies they are grappling with — one stemming from a massive lawsuit over possible trade secret and IP violations and the other from a crisis of leadership.

Both Infosys and TCS have also slashed their own growth projections for this year. TCS in particular ended up backpedalling after announcing at first that there was nothing to worry, but then later expressing concern over demand from the BFSI sector, a massive vertical for most Indian IT companies.

“The stage is now set for what could be the worst second quarter performance in almost a decade. Revenues of the top five large cap companies are expected to grow by around 1.5% quarter on quarter. Consequently, Nasscom is likely to cut its 10-12% constant currency industry growth target as well, which it has been holding onto stubbornly,” the head of a large Mumbai-based brokerage, who declined to be identified, told The Wire.

What’s going wrong?

When financial headwinds have hit the IT industry in the past, CEOs trot out the usual suspects. Softening sectoral specific-demand, US elections, global protectionism, a particularly nasty dollar-rupee exchange rate and often whatever is the latest geo-economic event that could threaten business.

This time around, some of these factors are in play, although most of them haven’t had significant impact. BFSI (banking, financial services and insurance) sector clients are indeed pulling back on discretionary spending. The run-up to the US election has had Congress focusing (mostly unsuccessfully) on plugging H1B visa loopholes. Brexit is turning out be a minor spoilsport.

“Cyclical and seasonal factors like that are always taken into account at the CFO level and are seen as something that passes eventually. More fundamentally though, what is happening right now is that IT firms are being hit at both ends by the general reducing of their traditional bread-and-butter business and an inability to capture meaningful digital business,” a senior executive of blue-chip IT firm, who declined to be identified, told The Wire.

Digital business growth

Multiple analysts and executives across the IT industry The Wire spoke to offered up numerous examples of this two-punch blow.

Three senior group executives at India's Tata Sons have resigned, people close to the matter told Reuters on Saturday, as management woes appeared to deepen at the $100 billion conglomerate following the stunning ouster of its chairman.

The three executives were members of an executive council disbanded after Tata dismissed chairman Cyrus Mistry on Monday. The council, comprising five senior Tata group executives and Mistry, was tasked with creating long-term value for stakeholders and boosting returns on investment.

Those who quit are group human resources chief N.S. Rajan; group business development and public affairs head Madhu Kannan; and group strategy executive Nirmalya Kumar.

Reuters could not reach any of the three for comment. Tata did not respond to an e-mail request for comment on Saturday.

Reuters reported earlier this week that the other two council executives, Mukund Rajan and Harish Bhat, would take on senior level responsibilities within the Tata group.

One person close to Tata said there was no certainty all the positions would be re-filled as the group's structure is likely to change with Mistry's exit. Another person, however, said replacements could be named as early as next week, though there was no management crisis as each Tata company has its own team of public affairs and business development executives.

But some governance experts say the resignations of senior executives risk increasing the sense of uncertainty at Tata.

"In the short term, obviously there'll be some disruption at the group level" said Shriram Subramanian of InGovern, a shareholder advocacy group. "People leaving at senior levels shows there's a lack of confidence between the two sides, and that needs to be reinstated at the earliest to contain any longer-term damage."

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In a leaked letter to the Tata board, Mistry has said he was opposed to Tata's aviation partnerships with Malaysia's AirAsia Bhd and Singapore Airlines.

In the case of Air Asia, a forensic investigation had found "fraudulent transactions" of 220 million rupees ($3.29 million) involving "non-existent parties", he alleged.

That prepared the ground for a "probe into the allegation of mismanagement of funds," said an official at the national Enforcement Directorate, on condition of anonymity.

The agency was not immediately available to comment. Tata did not respond to Reuters questions on this matter. An AirAsia India spokeswoman said she had no immediate comment.

In a move that could spread to other universities, about 80 information tech workers at UC San Francisco are facing layoffs and have begun training their replacements — lower-paid tech workers from an Indian outsourcing firm.

The outsourcing, laid out in a $50 million contract with Indian employment firm HCL Technologies, is unusual among public institutions, experts say. The school expects to save $30 million over five years.

“I don’t know of any other university that’s done this,” said Ron Hira, a Howard University professor who studies immigration and outsourcing. “At some point, you start to cross these ethical lines.”

The majority of the outsourced work will be done in India. Additional IT staff may be brought to the UCSF campus from overseas on H-1B visas, according to public documents.

Employees and advocates are criticizing the move, saying it will leave the university and the UCSF Medical Center staff with inferior service and could endanger medical data. The UCSF workers, due to lose their jobs in February, are training their replacements, sometimes via videoconferencing to India.

U.S. Rep. Zoe Lofgren on Tuesday asked University of California President Janet Napolitano to reverse the decision. Lofgren wrote that replacing some of the workers with H-1B visa holders would be a misuse of the visa

“I think it is proper to expect our major public institutions, such as the University of California, to comply with both the letter and the spirit of the law,” Lofgren said.

---

“They can replace just about any IT job with H-1B workers,” he said. “It’s obviously a major issue.”

UCSF offers graduate degrees in medicine, nursing, dentistry and pharmacy and has a $5.4 billion annual budget, with about two-thirds earmarked for employee salaries and benefits. Administrators say the university faces fiscal challenges.

“We’re under a great deal of pressure,” Joe Bengfort, chief information officer at UCSF, told employees at a staff meeting earlier this year, according to a video of the meeting. “Outsourcing is not a silver bullet and we don’t treat it as such, but it’s probably the most difficult thing we’ve done.”

The cuts amount to almost 20 percent of the university’s IT staff and fall heavily on back-office operations, according to a presentation made to employees.

The school has also contracted with cybersecurity firm FireEye and Dell for other IT functions.

In a statement, the university said the new contracts “will not only increase savings but also strengthen cyber security and enhance IT quality and consistency.”

---The move is similar to layoffs at Disney and Southern California Edison last year, where employees were forced to train their lower-paid replacements. Disney laid off about 250 IT workers, although some were brought back in different roles. Southern California Edison planned to pare about 500 workers through layoffs and attrition to outsource its operations.

More than a decade ago, the UCSF Medical Center contracted out its medical transcription. In 2003, a Pakastani transcriber threatened to post confidential patient records unless she received more money. The threat was eventually withdrawn.

Donald #Trump’s H-1B visa stand may hit #Indian tech companies. #Modi #BJP http://toi.in/bUXzJb via @timesofindia In an apparent reference to the current hot-button case against Disney World, Trump told an Iowa rally, "We will fight to protect every last American life. During the campaign, I also spent time with American workers who were laid off and forced to train. Foreign workers were brought in to replace them. We won't let this happen any more." Among his first actions after winning, Trump played a proactive role to keep air conditioning company Carrier from relocating to Mexico.India has come in for special mention not merely by Trump but by successive presidential candidates over the past decade, with the word "bangalored" becoming an acceptable verb. The 1990 H-1B visa programme allows US employers to import up to 65,000 foreign workers with "highly specialised knowledge". However, US studies have said the top users of the H-1B visa were outsourcing companies, mainly from India.Trump can reduce the cap on H-1B visas or raise the fees or auction them. He could also order that H-1B workers have to be paid higher wages which would make Americans more competitive.

The former White House counsel to Richard Nixon — the only U.S. president to resign from office — is warning that Donald Trump’s tenure “will end in calamity.”

John Dean, the lawyer the FBI described as “the master manipulator of the cover-up” in the Watergate scandal, took to Twitter on Monday night to describe Trump’s statement on Sally Yates, a Barack Obama appointee serving as acting attorney general, as “nasty” and a “new low.”

Trump fired Yates on Monday after she said she would not defend his controversial immigration and refugee executive order in court. A Muslim advocacy group filed a lawsuit earlier that day arguing that the order, which temporarily bars people from seven Muslim-majority countries from traveling to the U.S. and Trump says is needed to prevent terrorism, is unconstitutional. Over the weekend, it prompted waves of protests and confusion at airports across the country.

Ayush Suvalka has a lot going for him. He's about to graduate from one of the best engineering colleges in India and has already secured a job with the Bangalore branch of JPMorgan (JPM).The 21-year-old computer science student isn't planning to spend his career in India's version of Silicon Valley. He hopes the big American investment bank will move him to its U.S. headquarters after a few years."It's always been America because the companies, all the big companies, are there," Suvalka said. "The life there is... really amazing."President Trump and his desire to put "America First" could throw a wrench in those plans.Related: Tech industry braces for Trump's visa reformThe Trump administration is looking to make changes to a host of visa programs, including restricting the H-1B visa that allows thousands of Indian techies to work in the U.S.White House Press Secretary Sean Spicer said last month that this may be done "through executive order and through working with Congress."

That could spell the end of the American Dream for Suvalka and many of his peers."Probably America is now out of the picture," he said.Efforts to restrict foreign workers through legislation are already in progress -- multiple bills seeking curbs on the H-1B program have been introduced by Republican and Democrat lawmakers this year.Dr. Savita Rani, head of career counseling at the Ramaiah Institute of Technology where Suvalka studies, says jobs at outsourcing companies are in high demand because of the potential to move to the U.S.But the possibility of America's doors slamming shut is already sowing confusion among students."They were shattered and they did not know what to do," Rani said. "At this juncture, America has got a cold and India is sneezing."

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In Bangalore, meanwhile, Suvalka is already sketching out a Plan B."I'm thinking of Canada or New Zealand," he said, mentioning two countries whose immigration websites saw a huge surge in traffic as Trump closed in on his election win last November."Canada is a bit cheaper than America and it has amazing job opportunities," the young engineer added. "You can get a visa easily."

Former Rep. Bruce Morrison authored the H-1B visa bill in 1990 to allow American corporations to recruit the best foreign talent for emerging engineering and scientific jobs. But now Morrison says he is outraged by the way companies are abusing loopholes to outsource jobs to low-cost foreigners -- and sometimes even pressuring the displaced American workers to train their replacements. Morrison talks to Bill Whitaker for a report on the H-1B visa program to be broadcast on 60 Minutes Sunday, March 19 at 7 p.m. ET/PT.

Originally intended to help fill gaps in the high-tech workforce with highly skilled employees in situations where there aren’t enough Americans, the congressional framers of H-1B promised to protect U.S. jobs. Yet today, nearly every Silicon Valley tech company has brought in foreigners on H-1B visas and argue they can still use more because there are not enough Americans to fill those jobs. Morrison is mad. “There are a lot of qualified American workers, but companies will do better financially if they hire the foreigner worker,” he tells Whitaker. “I’m outraged. The H-1B has been hijacked as the main highway to bring people from abroad and displace American workers.”

One loophole H-1B companies are taking advantage of allows them to outsource jobs without even looking for Americans, if those jobs pay approximately $60,000 or higher. Many hi-tech jobs typically pay double that. Saving money on labor was never the bill’s intent. Says Morrison, “It’s really a travesty that should never have been allowed to happen.

Adding insult to this travesty is the practice of pressuring displaced employees to train their replacements, usually through a modest financial incentive. The practice was called “knowledge transfer” at Northeast Utilities, says Craig Diangelo, who along with some of his colleagues at the company were let go. He says they were replaced with Indian workers being paid half his salary with no benefits. “I didn’t get laid off for lack of work, I got laid off because somebody cheaper could do my job,” says Diangelo.

Diangelo and his fellow workers were also financially incentivized to remain at Northeast Utilities, now called Eversource, to train their replacements. During the process, he and his fellow staffers placed small American flags outside their offices as a quiet protest. A flag came down as each worker left the company after training a replacement. Diangelo’s flag came down last. “I went in and took the last picture. There were no more flags left,” he tells Whitaker. “You have a queasiness in your stomach...and you’re saying, ‘This can’t be possible. This didn’t happen.’”

"Putting American Workers First," reads the bold headline on the home page of the U.S. Citizenship and Immigration Services, proclaiming: "New Measures to Detect H-1B Visa Fraud and Abuse."A click through to the April 3 statement outlines steps the agency will take to clamp down on the use of temporary visas for foreign workers in specialty occupations. Among the areas of focus: "Employers petitioning for H-1B workers who work off-site at another company or organization’s location."Indian technology companies are in the cross hairs. Outsourcing providers such as Tata Consultancy Services Ltd., Infosys Ltd. and Wipro Ltd. are contracted by U.S. firms and government agencies to deploy programmers and engineers. This usually happens at the client's premises instead of their own offices: that is, "offsite."

Indian nationals are so dominant in the H-1B program that they accounted for 195,247, or 70.1 percent, of all beneficiaries in 2015. PROPORTION OF H-1B VISAS THAT GO TO INDIANS70.1%Whatever the impact on these outsourcing companies, the crackdown is already hurting the net worth of their billionaire founders as investors anticipate tightened enforcement will hurt earnings, Bloomberg News reported Wednesday. Tata Consultancy has lost about 3 percent since the U.S. administration announced on March 3 it would suspend premium processing of H-1B visas, lagging a 2.8 percent advance in the benchmark Sensex index.

India has signalled it could respond against the US move to restrict H-1B visas by capping the royalty payout by American companies in India to their parent firms.

Not only does the veiled threat signal a toughening of India’s stance, the move, if implemented, risks escalating into a full-blown trade war that could harm the otherwise warm relationship between the two countries.

“It is not just that Indian companies are in the US, several big US companies are in India too,” trade minister Nirmala Sitharaman told reporters on the sidelines of an event in New Delhi. “They are earning their margins, they are earning their profits, which go to the US economy. It is a situation which is not where only the Indian companies have to face the US executive order. There are many US companies in India which are doing business for some years now. If this debate has to be expanded, it has to be expanded to include all these aspects. We shall ensure that all these factors are kept in mind.”

The trade minister, however, declined to be drawn into a confrontational stance, saying India still preferred a constructive dialogue.

Sitharaman’s remarks came two days after US President Donald Trump ordered a review of the H-1B visa regime for bringing skilled foreign workers into the US, a move that could undermine technology and outsourcing firms.

When asked whether there is a case for India to drag countries such as the US, Australia and New Zealand to the World Trade Organization (WTO) for raising barriers to the free movement of professionals, Sitharaman said: “At this stage I can only say that we will ensure that we engage with them constructively. At the same time, I have no hesitation (in) saying that India will ensure that it shall not accept unfair treatment.”

At the event, Sitharaman said countries like the US had provided a commitment to the WTO on the number of work visas they would provide, and India can question them if they didn’t live up to the commitment.

Indian IT industry’s past sins threaten its futureThe inability of India’s IT services exporters, like TCS, Infosys and Wipro among others, to upscale their skills and their wares has led up to the current crisis

India’s beleaguered $150 billion IT services industry is facing an existential crisis following its discovery that US president Donald Trump did mean to go through with his pre-election threats to review a critical tool of its trade, H1B visas. This comes on top of the erosion of its competitive edge by automation and robotics. Already, the layoffs have started as projects get trimmed and margins take a hit.

Predictably, India’s software services exporters are in a state of paralysis in the face of these threats. Lacking a well-honed, long-term strategy to cope with the political and economic forces aligned against it, the industry has responded timidly—petitioning and invoking contributions to the US economy and producing numbers to state its case. This hasn’t cut much ice with the Trump administration, which has gone through with an executive order even while promising more draconian measures to protect American jobs. Contrast that with his kids-glove treatment of China. All his threats of naming the country as a currency manipulator before the elections seem to have been silenced once the reality of possible Chinese retaliation hit home.

The Indian software services industry is a custodian not merely of its own fortunes but that of the future of an entire nation. Even as industry leaders Tata Consultancy Services Ltd, Infosys Ltd and Wipro Ltd examine the impact of these recent setbacks on their bottom lines, concluding mostly that it will be marginal, there is a far bigger issue at stake. India’s success in software services exports has given it a unique competitive strength. In an increasingly digital world, India has the manpower and the head-start needed to build the kind of global position that, for instance, Germany has in engineering or before that Britain built with its naval fleet.

But as management guru Michael Porter warned, the competitive advantage of nations isn’t an inheritance on which a country has a perpetual lien. It is something a country needs to keep working on through innovation. In his original piece in 1990 for the Harvard Business Review, The Competitive Advantage of Nations, Porter wrote: “Ultimately, the only way to sustain a competitive advantage is to upgrade it—to move to more sophisticated types.”

By sitting back and continuing to rely on its cost-based arbitrage model for over two decades, the software industry has placed in jeopardy not merely its own fortunes but that of India too. Those who think that Trump’s executive order notwithstanding, it will be business as usual in the hallways of business processing offices in Bengaluru and Gurugram, might want to take a look at the recent and not-so-recent past.

The fate of India’s auto components industry, once touted as a potential world beater, is a good reminder. Despite its promising beginnings, India’s share in global exports has remained stuck below 1% over the last decade, as component makers failed to scale up and deal with the realities of a changing market. As a consequence, the value of auto component exports increased from $5.1 billion in FY09 to $10.8 billion in FY16 (according to data from the India Brand Equity Foundation), way below the sector’s Vision 2015 target of $33 billion set by the Auto Component Manufacturers’ Association back in 2003-04.

The $150-billion Indian IT sector has not just been an important contributor to the country's GDP and global exports, but has also been at the vanguard of white-collar job creation in an otherwise jobless growth of the past two decades.

For years, campuses across India have relied on the mass hiring by the likes of Infosys, Tech Mahindra, Cognizant, etc as the placement hub for India's large crop of engineers. But, of late, the sun has stopped shining on the sector. Major recruiters like Wipro, Infosys, Cognizant have been seen significant reduction in their workforce. The bad news though is that the worst is yet to come.

For various reasons, we may see massive layoffs in the IT sector. Here's why:

1. The rise of automation

Over the past few years, automation has gathered pace and, in the coming time, it promises to replace many jobs, especially of repetitive and mundane nature.

The competitive advantage in favour of automation has been increasing with technological advancement reducing cost, improving performance and wider applicability becoming possible. The Indian IT sector faces a serious challenge from automation as the nature of most jobs here is "mundane". Besides, human discretion and intelligence are low enough to be easily replaced by automation.

2. 'Freeze' on hiring Indians abroad

India's abundant labour force had made it less expensive to hire Indian expats for projects abroad. But the tide has turned against this trend with US proposing to raise the minimum income requirement for H1B visa to $130,000 from existing $60,000. Australia, Singapore and many other popular lucrative markets too have introduced procedural changes making life difficult for Indians. Getting a work visa has been made both time-consuming and costly.

This will affect one of the most lucrative opportunities that our IT workforce enjoyed, and make it more difficult to employ middle-level employees whose higher salary expectations are difficult to fulfil within India in an industry, where mass hiring at the bottom (to keep the cost low) is the norm.

3. Rises of protectionist politics in US, Europe

The rise of protectionist politics in advanced economies has increased the pressure on companies there to outsource contracts to local companies, instead of firms in India. This is making growth prospect more difficult for Indian IT companies.

The proposed reduction in corporation taxation in the US as well as France will also further incentivise more of the IT big shots to shift back some, if not a major portion, operation back to the US. All this again doesn't bode well for jobs in the Indian IT sector.

4. Corporate governance and Indian IT brands

Indian IT's fabled rise was built on the foundation of outstanding corporates who won the trust and respect of their stakeholders at home and abroad through admirable corporate governance.

But even as the industry needs the goodwill in these difficult times, the Indian IT bellwether have had a rather tough time negotiating corporate governance troubles.

While TCS has seen Tata Sons being mired in a dirty and ugly boardroom struggle, Infosys, after years of being led by unsatisfactory successors to its founders, found a decent performer in Vishal Sikka. But the respite seems short-lived as the current leadership has been engaged in a power-cum-perception struggle against Infosys old guard, notably Narayana Murthy, who has levelled and repeated some serious charges against the present leadership.

5. Sluggish global economy and low demand

As such, the big ticket projects are far fewer in number now with the global economy slowing compared to the initial decade of the millennium when Indian IT sector came of age.

Technology companies in India are in the midst of a massive restructuring drive that has both employees and industry analysts worried over the future of the sector.

Information Technology companies like Infosys, Cognizant and Tech Mahindra have announced redundancies this year and some analysts have said that this string of layoffs are expected to continue for the next two years.

A recent report from McKinsey India says that at least 200,000 software engineers in India will lose their jobs each year over the next three years.

According to local media reports, tech giant Infosys had earlier announced its plans to lay off about 1,000 employees at senior levels based on performance-based processes, the company also then announced its plans to hire 10,000 Americans over the next two years – a move many analysts have said will please U.S. President Donald Trump. Following this move, other companies such as Cognizant announced their plans to cut 6,000 jobs.

"With the majority of their business coming from US-based clients, it seems like a natural step for Indian IT companies to expand and strengthen their client offering in a market that promises sustained growth. This will undoubtedly benefit U.S. workers and sing to the tune of Trump's America First strategy," Af Malhotra, co-founder of Bangalore-based IT firm GrowthEnabler, told CNBC via email.

U.S. President Donald Trump's "America First" agenda and focus on curbing immigration especially around the much-sought-after H-1B visa policy may hurt India's massive information technology sector that forms a strong base for the country's economy.

Data from Goldman Sachs estimates that Indians accounted for nearly 195,257, or 70.1 percent, of all beneficiaries of the H-1B visa program in 2015. And hence, President Trump's decision to steer his policies towards "America First" is clearly going to hurt these professionals as well as Indian software companies. But there are divergent views on whether the redundancies in India by major IT companies have anything to do with Trump's policies.

"It does not seem like Indian companies are laying off in India so they can hire in the US," an IT-professional based in the U.S. told CNBC on the condition of anonymity due to the sensitive nature of the topic. "The IT sector has been struggling, these companies have been having poor disappointing earnings/lower guidance for a few quarters now and that is probably the primary driver."

Indian recruitment companies are seeing a surge in job applications from laid-off IT services workers, as the sector rapidly automates.

The Indian IT sector employs more than 3 million, according to industry body Nasscom.

IT companies such as Infosys and Wipro grew rapidly over the past three decades by hiring huge numbers of Indian software engineers to perform software installation and maintenance work for global companies, at relatively low cost.

But recruiters say the companies now appear to be cutting staff at an increasing rate, as they focus their businesses on fast-growing, cutting-edge fields such as data analytics and connected devices, which require smaller numbers of more highly-skilled staff.

“Lay-offs happen every year, but this is different,” said Alka Dhingra, assistant general manager at Teamlease, a large Indian recruitment company. Its applications in recent months from jobhunters in IT services were at least 50 per cent higher than in recent years, she said.

A further shadow over domestic job creation has been cast by the prospect of tighter immigration rules in the US, by far the industry’s biggest market, aimed at pushing companies to hire locally instead of bringing in workers from India. Infosys this month promised to hire 10,000 workers in the US.

The worries about job cuts in the industry reflect global concerns about the potential for rapidly developing automation to create unemployment — a particular concern in India, where about 1m young people enter the workforce each month.

The number of people seeking IT services jobs on Naukri, India’s most popular jobs website, increased 23 per cent year-on-year between January and April, it said.

The Forum for Information Technology Employees, a workers’ group, is seeking to form the industry’s first union to fight what it says were illegal job terminations seen recently in the sector.

The companies themselves have downplayed the scale of headcount reduction.

“To say the need of people in the business will go down is wrong,” said Ravi Kumar S, deputy chief operating officer at Infosys. “Automation will take away jobs of the past but will create lots more jobs of the future.”

Mr Kumar said the job cuts at Infosys in recent months were part of an annual process where “underperformers” were released, though he declined to say how the number of such cuts compared with previous years.

Lay-offs have also hit senior staff, as companies see less need for managers to handle large teams, said Kris Lakshimanth, chairman of Headhunters India, who estimates job inquiries from such people have doubled since last year.

“Companies are trying to reskill the employees [in new fields], but where there is no option, they're having to let them go,” said Ratna Gupta, a director at ABC Consultants, another recruitment company. “Obviously the number of humans required is going to be less.”

Technology companies in India are in the midst of a massive restructuring drive that has both employees and industry analysts worried over the future of the sector.

Information Technology companies like Infosys, Cognizant and Tech Mahindra have announced redundancies this year and some analysts have said that this string of layoffs are expected to continue for the next two years.

A recent report from McKinsey India says that at least 200,000 software engineers in India will lose their jobs each year over the next three years.

According to local media reports, tech giant Infosys had earlier announced its plans to lay off about 1,000 employees at senior levels based on performance-based processes, the company also then announced its plans to hire 10,000 Americans over the next two years – a move many analysts have said will please U.S. President Donald Trump. Following this move, other companies such as Cognizant announced their plans to cut 6,000 jobs.

"With the majority of their business coming from US-based clients, it seems like a natural step for Indian IT companies to expand and strengthen their client offering in a market that promises sustained growth. This will undoubtedly benefit U.S. workers and sing to the tune of Trump's America First strategy," Af Malhotra, co-founder of Bangalore-based IT firm GrowthEnabler, told CNBC via email.

U.S. President Donald Trump's "America First" agenda and focus on curbing immigration especially around the much-sought-after H-1B visa policy may hurt India's massive information technology sector that forms a strong base for the country's economy.

Indians top beneficiary of H-1B

Data from Goldman Sachs estimates that Indians accounted for nearly 195,257, or 70.1 percent, of all beneficiaries of the H-1B visa program in 2015. And hence, President Trump's decision to steer his policies towards "America First" is clearly going to hurt these professionals as well as Indian software companies. But there are divergent views on whether the redundancies in India by major IT companies have anything to do with Trump's policies.

"It does not seem like Indian companies are laying off in India so they can hire in the US," an IT-professional based in the U.S. told CNBC on the condition of anonymity due to the sensitive nature of the topic. "The IT sector has been struggling, these companies have been having poor disappointing earnings/lower guidance for a few quarters now and that is probably the primary driver."

NEW DELHI: British Airways' GMB union has reportedly blamed the airline's decision to outsource hundreds of IT jobs to India last year for the IT failure related problems on Saturday.The GMB website says the union had on February 29, 2016 warned against BA outsourcing IT jobs. The website quotes Mick Rix, GMB national officer for aviation, as saying then that a march will be held "in protest as the company plans to outsource and offshore work to one of the biggest IT majors in India.

The GMB website says "the affected job losses at Heathrow in West London is around 700 people and around 100 in New Castle and other locations."The Indian IT major "will need to carry out work in the UK and they will bring workers from India to fill the jobs of the ex BA workers," the website adds.

Erin Green, a former supervisor at Infosys, filed suit this week in the Eastern District of Texas in Sherman, alleging that he and black and white staffers on his team were denied raises and promotions, and that other "non-South Asian" workers were berated by South Asian company officials.

Green, of Frisco, is white and rose to the rank of "head of global immigration" while working in the company's Plano office. He was terminated in June of 2016, ostensibly for violating Infosys' "code of conduct by using his work computer for personal use a number of years earlier."

The race-based discrimination lawsuit by a former American employee comes just weeks after Infosys -- India's second-largest technology services company -- announced plans to hire 10,000 American workers at a time when President Donald Trump has been pushing an "America First" policy.

An Infosys spokeswoman said the company is "not in a position to comment on ongoing litigation." Green's attorney said he did not have time to answer questions.

"Infosys maintains [more than 20,000] employees working in the United States," Green's suit said. While less than 5 percent of the U. S. population is of the South Asian race and national origin, roughly 93 percent to 94 percent of Infosys's United States workforce "is of the South Asian national origin, (primarily Indian)." "This disproportionately South Asian and Indian workforce, by race and national origin, is a result of Infosys's intentional employment discrimination against individuals who are not South Asian, including discrimination in the hiring, promotion, compensation and termination of individuals," the suit said.

"Infosys has gone to great lengths to obtain its primarily South Asian workforce in the U. S., in particular by utilizing professional H-1B and L-1 work visas to bring South Asians (primarily Indians) into the United States to work in information technology ("IT") consulting roles," according to the suit.

Leading U.S. congressmen have called on President Donald Trump to press Indian Prime Minister Narendra Modi to remove barriers to U.S. trade and investment when they meet for the first time on Monday.

The lawmakers, from the Republican and Democratic parties, said in a letter to Trump that high-level engagement with India had failed to eliminate major trade and investment barriers and had not deterred India from imposing new ones.

"Many sectors of the Indian economy remain highly and unjustifiably protected, and India continues to be a difficult place for American companies to do business," they wrote, noting that a 2017 World Bank report ranked India 130th out of 190 countries for ease of doing business.

The lawmakers - Republican House Ways and Means Committee Chairman Kevin Brady and Ranking Member Richard Neal, and Republican Senate Finance Committee Chairman Orrin Hatch and Ranking Member Ron Wyden - said the bilateral economic relationship "severely underperforms" as a result of India's failure to enact market-based reforms.

They said the barriers covered multiple sectors and included high tariffs, inadequate protection of intellectual property rights, and inconsistent and non-transparent licensing and regulatory practices.

Among U.S. goods affected were solar and information technology products, telecommunications equipment and biotechnology products, they said.

The lawmakers also pointed to limitations on foreign participation in professional services, restrictive foreign equity caps for financial, retail, and other major services sectors and barriers to digital trade and Internet services.

"The list is long and growing," they said.

Modi is due to meet with about 20 leading U.S. CEOs in Washington on Sunday before his first meeting with Trump on Monday at the White House, when he will seek to revitalize ties that have appeared to drift, in spite of the priority they were afforded under former President Barack Obama.

While progress is expected in defense trade and cooperation, Trump, who campaigned on an "America First" platform has been irritated by the growing U.S. trade deficit with India and has called for reform of the H1B visa system that has benefited Indian tech firms.

Other signs of friction have included Trump accusing New Delhi of negotiating unscrupulously at the Paris climate talks to walk away with billions in aid.

Indian officials reject suggestions that Modi's "Make in India" platform is protectionist and complain about the U.S. regulatory process for generic pharmaceuticals and rules on fruit exports to the United States.

They stress the future importance of the huge Indian market to U.S. firms and major growth in areas such as aviation which will offer significant opportunities for U.S. manufacturers.

PUNE, India — Last month, Sudhakar Choudhari took the company bus as usual from his one-bedroom apartment to the suburban offices of Tech Mahindra, a major employer of workers in India that powers the global technology machine behind the scenes. Then a manager took him into a conference room and asked him to resign.

“It was a terrible scene for me,” said Mr. Choudhari, 41, who had been with the company for 11 years and most recently maintained software for a British client. As the manager spoke, he thought: “I have an 11-year-old child. My wife is not working. How to pay the home loans?”

Mr. Choudhari is one of a number of Indian technology workers who have lost their jobs in recent months as many in India debate whether an industry that has long served as a gateway to the middle class is preparing to shed jobs en masse.

India’s information technology industry grew at a breakneck speed over the past two decades thanks to the trend commonly called offshoring. The industry and related businesses generate more than $150 billion in annual revenue and employ about four million people to build and test software, to enter and analyze data, and to provide customer support for American and European companies looking for relatively inexpensive labor.

But the global tech industry is increasingly relying on automation, robotics, big data analytics, machine learning and consulting — technologies that threaten to bypass and even replace Indian workers. For example, automated processes may soon replace the kind of work Mr. Choudhari was performing for foreign clients, which involved maintaining software by occasionally plugging in simple code and analyzing data.

“What we’re seeing is an acceleration in shedding for jobs in India and an adding of jobs onshore,” said Sandra Notardonato, an analyst and research vice president for Gartner, a research and advisory company. “Even if these companies don’t have huge net losses, there’s a person who will suffer, and that’s a person with a limited skill set in India.”

Such job losses could be politically damaging to the government of Prime Minister Narendra Modi, who won an electoral mandate in 2014 on the promise of development and employment for a bulging youth population. In January, near the three-year mark of his administration, an economic survey reported that job creation had stalled.

So far, the scale of the impact is not clear. T. V. Mohandas Pai, a longtime industry figure, estimates the cuts will encompass up to 2 percent of the work force by September, mainly from culling underperformers. A 2015 study released by the National Association of Software and Services Companies, the Indian technology industry trade group known as Nasscom, and McKinsey India found that 50 to 70 percent of workers’ skills would be irrelevant by 2020.

Of course, new technologies will create new jobs. The impact of automation and artificial intelligence still is not clear, and they could open up new areas that simply shift tech work rather than eliminate it.

But some in the Indian tech industry worry that many of the new jobs will be created outside India, in places like the United States, in part because President Trump has pledged to tighten visa laws that allowed many Indian nationals to go to that country to work. The subject is likely to pop up on Monday, when Mr. Modi is scheduled to visit the White House.

The Indian government has rushed to reassure the public that job losses will be minimal. Ravi Shankar Prasad, the Indian minister who oversees the technology industry, recently denied that major layoffs were occurring even as he encouraged the industry to speed up development.

The woes of Indian information technology companies are not limited to the US and extend from Australia to Canada as they not only have to grapple with visa curbs but also obscure rules that are open to interpretation by local authorities.Following the concerns brought out by Nasscom in a study, the government has started flagging the hurdles, many of which are against the commitments given by these countries at the World Trade Organisation or in trade agreements with India. The study has brought out the fact that there is no match between the commitments given and the visa issued.The report comes at a time when India is seeking a permanent agreement for trade facilitation in services. Separately, it is pushing for liberal rules in Asean and other countries such as China, Australia and New Zealand, under the regional comprehensive economic partnership agreement, which will create one of the world's largest free trade areas.

These countries are, however, reluctant to ease the rules, but are seeking sharp duty cuts for goods imported into India. What makes it easier for other countries not to honour their commitments is the absence of any clarity on the number of visas that they have agreed to. Pointing to the US, Nasscom has said that it is the only country that partially mentions the visa category, H1, under WTO's agreement on trade in services (GATS) but there is nothing on offer for the information, communication and technology category.Then, there are other conditions such as high fees to dilute the commitments. Some rules could even be tweaked by countries. For example, Indonesia had notified a rule allowing one visa for every 10 local workers hired. Other complaints revolve around the duration of the visa and the time taken to issue it, which can be long, and can often come with quotas. What makes life more difficult for Indian workers is the fact that many countries have not signed (and some are reluctant) social security agreements which will allow for contributions to be transferred once the employee returns to India.

There are other issues which have stalled the Indian IT sector's expansion drive, such as outdated definitions, said a government official. For instance, there is very little clarity on the definitions of contractual service providers, independent professionals and inter-corporate transfers, which results in lack of confidence among companies.The industry also has to deal with subjective and discretionary elements of the commitments that have been given, resulting in interpretations that are only meant to block access.

As President Donald Trump considers plans to create new rules that would curb H-1B visa extensions and could see thousands of mostly Indian skilled workers deported while they wait for their green cards, industry leaders in India are warning that the move could also hurt the U.S. economy.

The proposal, which was part of Trump's Buy American, Hire American initiative that he vowed to launch on the campaign trail, is being drafted by Department of Homeland Security leaders, sources have told McClatchy DC. If approved, it could see as many as 500,000 to 750,000 Indian H-1B visa holders forced to leave the U.S., IndiaToday.in has reported.

Those who have their green card approved would be able to return to the U.S., but it would essentially mean restarting the process of establishing a life in America.

Industry leaders in India have also warned that the new rules could cause a shortage of skilled workers in the U.S., potentially damaging the country's economy.

The great Indian trade-offSluggish exports leave India needing to curry favour with investorsPerennial domestic weakness, and America’s recent protectionist turn, make it hard for India to sell more abroad

In the 12 months to March 2018, $303bn of Indian goods ended up overseas. That was up on the previous year, but still short of the $310bn achieved in 2014, when the Indian economy was a quarter smaller. Imports, meanwhile, have increased to $460bn, pushing the merchandise deficit to $157bn last year, up from $109bn in 2016-17 and its highest level in five years. A surplus in services such as IT outsourcing helps reduce the overall trade deficit by around half, but even there imports are growing faster than exports.

The shortfall is swollen by the rising price of oil, lots of which India imports (and some of which is also sold on as refined products). The surge from around $30 per barrel in early 2016 to over $70 now goes a long way to explaining the rise in India’s current-account deficit, which is expected to reach 2% of GDP this fiscal year, triple last year’s reading. Gold imports, used for saving or jewellery, have their own unpredictable rhythms, but also deepen the deficit.

The current trade lull extends beyond gold and oil, however. Exporters across the economy are being squeezed by the poor implementation of a goods-and-services tax that came into force last July. Perhaps 100bn rupees ($1.5bn) of refunds due to exporters once they can prove they have shipped their wares abroad is being held up by sclerotic administration. That is working capital which small-time exporters cannot easily replace.

Worse, a $2bn suspected fraud by a diamond dealer in February has resulted in regulators banning certain types of bank guarantees that exporters use to ensure they get paid promptly, exacerbating their funding problems. These snafus come as many firms are still recovering from the ill-advised “demonetisation” of November 2016, when most banknotes were taken out of circulation overnight. The move snagged local supply chains, giving foreign rivals opportunities to fulfil orders that would have gone to hobbled Indian firms and to gain market share in India itself.

Those woes come on top of perennial frailties. Crippling red tape means most Indian firms are small: the country lacks the mega-factories hosting thousands of workers making T-shirts or mobile phones that are common elsewhere in Asia. All but a few firms lack the heft to participate in global supply chains. A relatively strong rupee in recent years has not helped.

Unwilling to enact labour and land-acquisition reforms that might foster larger firms, the Indian government is instead shielding its industry from foreign competition. In recent months it has imposed tariffs on a dizzying array of goods, from mobile phones to kites. Though those will no doubt help stymie imports, it is just as likely that trade measures imposed by other governments will hobble India’s exports.

For it is India’s misfortune that Donald Trump’s America is its biggest source of trade surpluses. Mr Trump’s administration has multiplied the salvos against India, whether decrying supposed export subsidies, making it harder for Indian IT workers to get visas or accusing India of artificially weakening its currency. Unlike many American allies, India has not been exempted from imminent steel tariffs.

India would be seriously damaged by any further escalation in trade conflicts. It needs hard currency from exports not only to finance imports and economic growth, but also to repay external debts. These have swelled to around $500bn, or roughly a fifth of GDP, more than 40% of which is due in less than a year.

Coming to the U.S. on a work visa is getting harder across the board, but workers from India in particular are feeling the effects of recent policy shifts from the Trump administration. A new report from the National Foundation for American Policy sheds light on how the “Buy American and Hire American” executive order from April 2017 has impacted H-1B applicants in the last year. The H-1B visa, popular in Silicon Valley, lets skilled foreign workers live and work in the U.S. for a six year term.

For the three months period starting in July 2017, H-1B denial rates went from 15.9% to 22.4%. In the same time period, Requests for Evidence seeking additional documentation in the fourth quarter of 2017 nearly equaled the total amount of Requests for Evidence from the year’s other three quarters combined (63,184 and 63,599 requests, respectively).

Drilling down, workers from India appear to be the most affected. From July to September 2017, U.S. Citizenship and Immigration Services (USCIS) demanded additional documentation from 72% of Indian H-1B applications, compared to the 61% rate of other countries considered together. During that same three month period, 23.6% of Indian applications were rejected, up from 16.6% between April and June 2017.

“The increase in denials and Requests for Evidence of even the most highly skilled applicants seeking permission to work in America indicates the Trump administration is interested in less immigration, not ‘merit-based’ immigration,” the report adds.

“… U.S. Citizenship and Immigration Services has enacted a series of policies to make it more difficult for even the most highly educated scientists and engineers to work in the United States.”

In January, rumors of a ban on H-1B extensions for green card applicants had H-1B workers nervous. In June, new rules shortening visas for Chinese STEM students went into effect. While China only accounted for 9.4% of total H-1B visa applications in the 2017 fiscal year compared to India’s whopping 76%, the Trump administration will likely continue to tighten immigration policies targeting China as it obsessively tries to turn the screws on its perceived trade nemesis.

In the wake of a report that the U.S. crackdown on the controversial H-1B foreign-worker visa is falling more heavily on Indian citizens, a staffing and outsourcing company filed a lawsuit against the federal government claiming an Indian worker was illegally denied an H-1B visa.

Stellar Software Network alleges that U.S. Citizenship and Immigration’s denial of a visa for Kartik Krishnamurthy was “arbitrary and capricious.”

The agency declined to comment on the lawsuit.

Krishnamurthy had worked for Stellar under the H-1B visa for nearly seven years until the end of May, the lawsuit said. Stellar supplies workers and software services to clients.

The H-1B, obtained by employers, is intended for highly skilled workers doing specialized jobs, and the visa has become a flashpoint in the immigration debate. Supporters, including many of Silicon Valley’s largest technology companies, have lobbied for an expansion of the annual 85,000 cap on new visas, arguing that companies need to be able to bring in the world’s top talent. Critics point to reported abuses, mostly by outsourcing companies but also by UC San Francisco and Disney, and assert that H-1B holders take jobs from Americans.

Though the H-1B can be a path to a green card, many who hold it spend years or even decades on repeated visa extensions because of the processing backlog for green cards.

The problem for Stellar and Krishnamurthy started in August 2017 with a request for a visa extension. That’s when the company and the worker ran into the H-1B crackdown that arose from President Donald Trump’s “Buy American and Hire American” executive order. Federal authorities appear to be focusing H-1B enforcement efforts on staffing and outsourcing companies providing foreign workers to U.S. firms.

Late last year, federal authorities began ramping up their rate of visa denials and requests for evidence that a requesting company, worker and job match the visa requirements, a report said earlier this year. And applications for Indian workers were more frequently subjected to the “requests for evidence,” according to the report by the National Foundation for American Policy.

Citizenship and Immigration made such a request regarding Krishnamurthy’s proposed H-1B extension, telling Maryland-based Stellar it had until April 17 to respond, the suit said. But almost a month before that date, the agency denied the extension, the suit claimed.

Stellar’s request that the agency reconsider the decision was denied, according to the suit, filed Tuesday in U.S. District Court in Washington, D.C.

Federal officials cited a lack of evidence concerning the “end-client’s” workplace where Krishnamurthy would be placed, and contended that Stellar hadn’t proved it would supervise his work at the third-party site, the suit said.

Stellar argued that a letter from Honda of North America submitted to the agency as evidence “completely refuted” the contention that not enough evidence was supplied about Krishnamurthy’s planned workplace. And two U.S. Supreme Court decisions, plus the agency’s own Adjudicator’s Field Manual, impose a requirement that a company must have the right to control an employee’s work at a client site, but whether it exerts actual control is irrelevant, the suit said.

US Citizenship and Immigration Services (USCIS) director L F Cissna has said that he could draft a provision immediately that prohibits H1B visa workers from replacing American workers if the US Congress passes it. Speaking at Immigration Newsmaker conversation event on August 15, L F Cissna strongly advocated for a stricter provision preventing American workers getting replaced by H1B visa holders.

“I would really love it if Congress would just pass a one-sentence provision that would just prohibit American workers in being replaced by H-1B workers. I could draft it myself, you know, probably right now, you know? It’s – those are the things off the top of my head,” he said at the event. H1B visa is quite popular among Indian IT professionals.

The USCIS returned all petitions of H1B visas in April that were not selected through the computer-generated lottery system. The H1B visa is a non-immigrant visa that allows foreign workers with specialisation to work in American companies. US technology companies rely heavily on workers from India and China.

“There’s little tweaks we could make to the way we administer, say, the H-1B program to possibly, you know, make – improve the chances of U.S. educated students getting a better shot at an H-1B visa, maybe. (sic),” L F Cissna said, adding that there are highly skilled US-educated foreign students who a US employer wants to hire.

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About Me

I am the Founder and President of PakAlumni Worldwide, a global social network for Pakistanis, South Asians and their friends. I also served as Chairman of the NEDians Convention 2007. In addition to being a South Asia watcher, an investor, business consultant and avid follower of the world financial markets, I have more than 25 years experience in the hi-tech industry. I have been on the faculties of Rutgers University and NED Engineering University and cofounded two high-tech startups, Cautella, Inc. and DynArray Corp and managed multi-million dollar P&Ls. I am a pioneer of the PC and mobile businesses and I have held senior management positions in hardware and software development of Intel’s microprocessor product line from 8086 to Pentium processors. My experience includes senior roles in marketing, engineering and business management. I was recognized as “Person of the Year” by PC Magazine for my contribution to 80386 program. I have an MS degree in Electrical engineering from the New Jersey Institute of Technology.
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